BMW broke yet another sales record in a market that we are told is closed

Recently, Detroit’s previously strident rhetoric about the allegedly “closed market” Japan quieted down a bit. This after a series of articles with car importer after car importer showing that the “closed market” story is a blatant lie. Japan in fact has one of the world’s most open car markets, mostly due to American pressure. Zero percent tariff. 5,000 cars per year and model can be brought in with next to no paperwork. Try that in the U.S.A., where Detroit’s cash cow, the light utility vehicle, is protected by a 25 percent tariff, and a huge wall of other trade barriers.

Today, I could revisit the story, when Peter Kronschnabl, CEO of BMW Group Japan, presented his 2017 results, and yet another sales record.

In 2017, BMW Group imported more than 83,000 units into Japan, including 5,230 motor cycles, a number that made BMW “Japan’s largest importer,” Kronschnabl said. Volkswagen Group will probably debate this, because according to the official stats, VW brought in some 2,000 cars more last year. Mercedes was third.

Japan is not only a wide-open car market, it also embraces import brands with gusto – if they bring in the proper product. The proper product is premium cars. Japanese automakers are strong competition, but they are a bit weak in the upper segments. Japan is not BMW’s highest volume market, but it is one of BMW’s most profitable.

Somehow, Cadillac is not taken seriously as a premium offer in Japan – last year, it could sell only 580 units in the island nation.

“It is much easier to bring cars into Japan than most other markets,” told me Magnus Hansson, CEO of Jaguar Land Rover Japan. “The hard part is selling the car when it’s in Japan.” American brands do notoriously little to sell their cars. Since 2008, Detroit boycotted Japanese car shows, their own dealers complain about a lack of advertising.

Cars by BMW, coffee by Dean & Deluca (c) Bertel Schmitt

“There is no point in having great product if nobody knows about it,” Kronschnabl said today. It is nearly impossible to escape BMW’s messaging in Japan. They are a familiar sight on Japanese car shows, they even organize their own events on Fuji raceway. Today, BMW inaugurated yet another activity to stay in touch with its customers, its own version of cars & coffee, so to speak. BMW converted the ground floor of the snazzy GranTokyo South Tower into a café. The café part is run by Dean & Deluca, New York’s famous upscale grocer.

As strange as it may sound, BMW is one of the largest, if not the largest importer of Made in the U.S.A. cars to Japan. BMW X3, X4, X5 and X6 are imported from America, where they are made in BMW’s huge Spartanburg, SC, plant. And now, BMW even imports American café culture to Japan.